Finance Minister Nirmala Sitharaman on Monday (14 October) said PSBs have disbursed about Rs 82,000 crore in the nine-day outreach programme to push up retail credit and banks have witnessed robust demand during that period and she has asked the banks to look at the scope of MSMEs' demand for bill discounting.
Bill discounting is a discount/fee which a bank takes from a seller to release funds before the credit period ends. Bill discounting is mostly applicable in scenarios when a buyer buys goods from the seller and the payment is to be made through letter of credit.
Earlier Finance Secretary Rajeev Kumar said "Finance Minister Nirmala Sitharaman today reviewed the credit growth progress in the public sector banks and they have reported that they have disbursed Rs 81,781 crore in retail in the nine days of the outreach programme and have followed the prudential norms in the credit outreach. During this period of nine days, PSBs have given Rs 34,342 crore to new businesses. PSBs have said they have sufficient liquidity."
The second outreach programme will start on 21 October. In the meeting, Kumar said big corporates owe Rs 40,000 crore to MSMEs and banks have been told to look at the option of doing bill discounting for MSMEs.
"Big corporates owe Rs 40,000 crore to MSMEs. PSBs will have an outreach programme on bill discounting. MCA (Ministry of Corporate Affairs) has a list of big companies who owe money to MSMEs. PSBs will ask concerned MSMEs if they are interested in bill discounting," Kumar said.
Sitharaman said "We have asked and will push for big companies to expedite payments to MSMEs and have asked the banks to come back to us on MSMEs' payment by 22 October on demand for bill discounting".
(This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.)
As you are no doubt aware, Swarajya is a media product that is directly dependent on support from its readers in the form of subscriptions. We do not have the muscle and backing of a large media conglomerate nor are we playing for the large advertisement sweep-stake.
Our business model is you and your subscription. And in challenging times like these, we need your support now more than ever.
We deliver over 10 - 15 high quality articles with expert insights and views. From 7AM in the morning to 10PM late night we operate to ensure you, the reader, get to see what is just right.
Becoming a Patron or a subscriber for as little as Rs 1200/year is the best way you can support our efforts.